Should add, that when dealing with tantulum credits you also need to deal with quality of the tantulum concentrate itself. We have little data on that, although it would appear too me LTR is been
conservative (and IMO at least realistic) in its forecasts.
PLS in its DFS back before 2020 for those inclined to research was reporting credits for 28% - 30% concentrate in excess of US$80 per tonne, and in production has not stipulated what those credits actually are (well I haven't seen any numbers so will be interested if they have reported such numbers). At the time, around 2019 - 2020 - refer back to the embedded posts in my previous post - I felt PLS were been very aggressive with that forecast -
Post #:
43778205
.
Understanding how tantulum credits and cash costs are been reported is also a key so you can do apples to apples comparisons. If the credits are recorded on a Dry Metric Tonne basis you need to multiply the numbers by 91% (i.e. assuming moisture content of 9% to get to a Wet Metric Tonne basis given cash costs are generally reported for spodumene). The estimates I have given are on a DMT basis, because LTR is reporting its costs on a DMT basis.
Reported spodumene prices you see on the internet are can be on WMT basis, so you need to multiply those prices by 91% (quoted prices generally have 9% moisture) to get back to a DMT basis and thus do an apples to apples comparison. But check first how the internet spodumene prices are actually been reported.
So on a WMT basis, LTR's tantulum credits would be around A$55 per tonne for its 30% concentrate. Using a 70c exchange rate assumption, this converts to a credit of US$38.50 per tonne of spodumene cash costs, which appears reasonable too me (refer previous post).
LTR's estimated opex costs are A$651 per tonne for each tonne of spodumene produced, which is on a DMT basis (or US$456 per tonne using a 70c exchange rate assumption). Multiply that by 1.09 and the cost becomes A$710 on a WMT basis (or US$497 on a WMT basis).
Where did I get the A$60 DMT credit for tantulum come from - it came from
Post #:
70089149
, a project update in late 2023, when LTR updated the cash cost (i.e. refer to the table in that Ann). And for the record in the Nov 2021 DFS LTR were using a US$47 per tonne - US$48 per tonne DMT credit for tantulum. Meaning they have slightly reduced their DMT credit estimates for tantulum since 2021 (refer Table 12 of the DFS -
Post #:
57483407
)
Hence this is why I have some comfort in the tantulum credit numbers - as they appear more reasonable and within the calculations I did some time ago when looking at tantulum credits more broadly. Although to repeat, quality and price also matter for tantulum credits, so if others have calculations please share as this is a discussion forum where ideas are shared.
See a good VB makes me think.
All IMO
(20min delay)